Intel opens plant making smallest, fastest chip

Intel unveiled a plant on Thursday that manufactures the semiconductor company’s newest 65-nanometer chips, an industry-leading technology that allows computers to work faster using less energy.

Chief executive Paul Otellini officially opened the Fab 24-2 plant in Leixlip, west of Dublin, Intel’s major manufacturing base in Europe since 1989. The plant, which began production three months ago, joins similar facilities in the United States in making Intel’s most efficient microprocessor, the chips that run computers and other electronic devices.

Intel’s first 65-nanometer plant began production last year in Portland, Oregon, the second earlier this year in Chandler, Arizona.
But Intel officials say the Irish plant will be the most cost-effective of the three, citing Ireland’s exceptionally low

business tax rates and lower wage levels than in the United States.

“Intel’s ability to ramp advanced 65-nanometer silicon technology into high-volume production in three factories clearly sets us apart,” said Otellini, who revealed that more than half of Intel’s worldwide output of chips for computers and servers now contains the 65-nanometer standard.

This technology means Intel can pack more transistors onto a single fingernail-sized chip than ever before. The company estimates that about 100 of these transistors could fit into a single human blood cell. But Intel, which invests heavily to stay ahead of its main competitor Advanced Micro Devices (AMD), is already planning to produce 45-nanometer chips by the end of 2007.

Intel completed the 5 500-square-metre plant despite losing about â,¬170-million in state aid midway through the two-year project.

Ireland reluctantly withdrew the help in March 2005 after European Union competition authorities signaled they would reject the aid as illegal—the first time EU authorities fought such aid for Intel in Ireland. Previously, the Santa Clara, California-based company had received about â,¬220-million in Irish state aid.

Underscoring the government’s interest in Intel, Prime Minister Bertie Ahern attended Thursday’s opening and praised the new plant as ensuring “that Intel Ireland remains at the leading edge in the semiconductor industry”.

He also signed a memorandum of understanding with Intel chiefs that commits the company to work with the government to promote home computer use in Ireland.

“At a national level, the arrival of Intel in Ireland has helped in no small way to put us into the first division of technology-driven economies,” Ahern said.

“With the widest range of process technologies and the largest number of products of any Intel factory worldwide, it is a flagship project for the ICT industry in Ireland.”

Christian Morales, vice-president and general manager of Intel’s European, Middle East and African operations, said the 65-nanometer chip was about 40% faster and used 40% less energy than previous chips, boosting performance and battery life. He said about 2 000 of the 5 500 Intel employees in Ireland were working on the new production line.

Morales said the Ireland plant was bigger and “more technologically advanced” than the facilities in Oregon and Arizona, and “has the potential to generate the highest processor output in the world”.

He said the Irish operation was proving “more efficient than in the United States,” but declined to discuss specifics. He said the main down side to operating in Ireland was its membership in the euro, which has been strong for four years versus the US dollar—a problem since Irish-produced chips are priced in euros but exported worldwide.

Nonetheless, Morales said Intel had secured government planning permission for two more potential plants at its Leixlip campus.

“Right now we have no corporate plans to expand in Ireland, but we have planning permission for 10 years, so we have time to make decisions,” he said. - Sapa-AP